Estimation�in Construction

Dr Adewale Abimbola, FHEA, GMICE.

www.edulibrary.co.uk

Aim: �Estimation in Construction

Objectives: At the end of the lesson, the students should be able to:

Introduction

• Estimation in construction is a method for calculating the likely cost of a project before it begins,.
• Estimation = Measurement + Rates.
• Measurement involves systematically quantifying project items using established rules (New Rules of Measurement [NRM 1-3], Civil Engineering Standard Methods of Measurement [CESMM4]), creating a structured approach for drafting take-off lists and Bill of Quantities (BQ).
• Successful estimation demands comprehensive knowledge of construction processes, material and labour costs, alongside expertise, experience, foresight, and sound judgment.
• A reliable construction job estimate is an informed prediction of potential costs, derived from detailed plans and specifications.
• An effective estimate should align closely with actual costs upon completion, typically within a 5 to 10% variance, barring extraordinary or unforeseen events.

Estimation - Importance

• Estimating is crucial for determining the preliminary cost of a project, helping in assessing its financial viability and securing necessary funds if the project is greenlit.
• Estimating is vital for preparing tenders, overseeing contractors' work, and ensuring accurate payments during and after project completion.
• Detailed estimation breaks down the quantities of various work items, aiding in resource allocation, activity planning, and overall project scheduling.

Estimation Methods

• There are two major methods of estimation in the construction industry (Brooks, 2008):
• Single-rate methods.
• These are the functional unit and superficial floor area methods.
• Multiple-rate methods.
• These are the elemental cost plan, approximate quantities, and analytical & operational pricing of bills of quantities.
• Only the superficial floor area method will be considered in this course.

Estimating Methods

Superficial Estimating Method

• This approach involves determining the likely cost of projects by measuring the total internal floor space of the buildings, bordered by the interior sides of external walls, and then multiplying this area by a predetermined cost per square metre.
• This technique is straightforward and quick to apply, offering a fast way to estimate project expenses.

Superficial Estimating Method

• Important considerations in SPON’S A&B 2024
• Tender Price Indices (TPI):
• •Tender price indices represent the price for which the contractor offers to do the project for, i.e. cost to client.
• •They consider market considerations such as the availability of labour and materials, and the prevailing economic situation.

​

Table 1. Tender price indices (AECOM Ltd, 2024)

Superficial Estimating Method

• Important considerations in SPON’S A&B 2024
• Location Factor:
• Prices throughout the book are at a price level index of 167 for Outer London (location factor = 1.00).

Figure 1. Location factor (AECOM Ltd, 2024)

Key terminology:

Gross Internal Floor Area (GIFA or GIA): this is the area of a building measured to the internal face of the perimeter walls at each floor level.

Consult: https://www.designingbuildings.co.uk/wiki/Gross_internal_area_GIA for more information.

Worked Example 1

Three-storey semi-detached housing

Floor area = 102 m²

Cost plan prepared with current TPI = 167

Start on site December 2024, TPI = 156.7 (Table 1)

Location: Wales = 0.87 (adjustment = -13%) (Fig. 1)

From Building Prices per Square Metre = £2,050 per m²

Professional fees such as QS, architects, Town and County Planning fees, etc., and other facilitating type costs such as demolition, external works, car parking, bringing services to site, etc. are not included in the rate above. These will need to be considered separately.

Worked Example 2

Five persons, three bedroom, two-storey terraced housing

Total floor area = 93 m²

Site area = 10,000 m² (Depth/Length = 250 m)

1) How many of such 5P3B homes will fit into the site?

Note: consider garden, sustainable drainage systems (SuDS), car parking and road network requirements.

2) Estimate the likely cost of the project?

Given:

Cost plan prepared with current TPI = 167

Start on site January 2025, TPI = 157.9 (Table 1)

Location: Wales = 0.87 (adjustment = -13%) (Fig. 1)

From Building Prices per Square Metre = £1,700 per m²

Worked Example 2 - Solution

Garden consideration:

minimum of 10.5 m depth/length or 50 m² per house

Cardiff Residential Design Guide

Cardiff supplementary planning guidance

SuDS strategy:

12-15% of the total land area can be allocated for open storage. To minimises land take, multipurpose SuDS features can be used in house frontages.

Green Blue Urban

Road requirements:

2 m for vulnerable users

1.2 m for street access from home

4.8 m road space

8.0 m total road width

Cardiff Council Planning, Transport & Environment

Infrastructure & Operations

Car parking size:

Two vehicles parking in parallel (side by side) – 6 metres (length) x 6.2 metres (width) = 37.2 m²

Common standards for residential, industrial & commercial estate roads

Worked Example 2 - Solution

Approximately 50 five-person, three-bedroom, two-storey terraced houses can fit into the given site area, considering the requirements for gardens, SuDS, car parking, and road network.

Worked Example 2 - Solution

Five-persons-three-bedroom two-storey detached housing

Floor area = 93 m²

Cost plan prepared with current TPI = 167

Start on site January 2025, TPI = 157.9 (Table 1)

Location: Wales = 0.87 (adjustment = -13%) (Fig. 1)

From Building Prices per Square Metre = £1,700 per m²

Worked Example 2 - Additional information

• The total order of cost estimate does not include the professional fees such as QS, architects, Town and County Planning fees, etc., and other facilitating type costs such as demolition, external works, car parking, bringing services to site, etc. are not included in the rate above. These will need to be considered separately (AECOM ltd., 2024).
• According to Costmodelling Limited (2024), professional fees can be anything from 5% to 15% depending on the size of the project, and external works can be between 10 and 20% of the building cost.

Source: Link here

Self-assessment Task 1A

A) Choose one of the three home types below and estimate the number of units that will fit into a site with an area of 17,837.60 m² (Depth/length = 347 m). To choose the floor area, refer to Appendix A.

Note: consider garden, sustainable drainage systems (SuDS), car parking and road network requirements.

1. Two-bedroom
2. Three bedroom
3. Four bedroom

Note: include your solution in the appendices section of the main report for your assignment.

Hint:

Self-assessment Task 1B

B) Then, using the building prices per square metre method in Spon’s A&B Price Book 2024, produce the total order of cost estimate for the CCTC New Homes residential project in Cardiff, Wales.

Additional information

Cost plan prepared with current TPI = 167.

Start on site March 2025, TPI = 157.9

Note: include your solution in the appendices section of the main report for your assignment.

Hint:

Appendix A

Figure 2. Floor areas (Welsh Government, 2021)

References/Bibliography

AECOM Ltd (2024) Spon’s Architects’ and Builders’ Price Book. 149th edn. Oxon: Taylor & Francis.

Brooks, M. (2008) Estimating and tendering for construction work. 4^th edn. London: Routledge.

Cartlidge, D. (2009) Quantity surveyor’s pocket book. Oxford: Elsevier Ltd.

Lee, S., Trench, W. and Willis, A. (2005) Willis’s elements of quantity surveying. 10th edn. Oxford: Blackwell Publishing.

Potter, B. (2021) Construction Cost Breakdown and Partial Industrialization. Constr. Physic. Available online: https://www.construction-physics.com/p/construction-cost-breakdown-and-partial (Accessed: 23 January 2024).

Welsh Government (2021) Welsh development quality requirements 2021: creating beautiful homes and places. Available at: https://www.gov.wales/sites/default/files/publications/2021-08/development-quality-requirements-for-housing-associations.pdf (Accessed:01 October 2024).

​

​

​